Wow. This has been a great day for difficult questions! Thanks for making me blow the cobwebs out of this dusty brain!
Okay, let's dive right in. I am going to guess that you are referring to the phrase "Tat Tvam Asi," the Sanskrit phrase that roughly translates as either "That art thou," "You are that," or "That you are" depending on who you ask. Those are the translations people are pretty sure of. Unfortunately, that's about all people are sure of when it comes to this phrase.
Interpreting it depends a lot on your point of view, and in this case it depends on how you are interpreting certain Hindu religious texts. The one that I like best, and that makes the most sense (especially to Western readers,) is the one that comes from the Advaita Vedanta (the dominant school of thought for the interpretation of Hinduism.)
Essentially, what the phrase is saying (at least according to the Advaita school of thought) is that the phrase means that there is no separation of people from Brahman (God.) The phrasing is hard to get around and would even if it wasn't so old. It takes a good deal of poking and prodding to make sense of it, so I won't even try.
Tat Tvam Asi is essentially saying that Brahman (the creator of reality and everything else,) though veiled by Maya (the illusion that the world around us is real,) is the same as what we might call "our spirit" (in a Christian sense.) The idea is that the real stuff people are made of is the same that makes up God (Brahman.)